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American Account: America stymied as governments bid to control oil

CONCENTRATION on fluctuations in oil prices has detracted attention from the fundamental changes occurring in world oil and gas markets. Let’s start with President Bush’s inaugural address, in which he promised to support democratic reformers in the Middle East.

The policy shift comes at a time when dependence on imported oil leaves America more vulnerable than ever to changes in world energy markets. Increasingly powerful state-owned players are putting America not only at an increasing economic disadvantage, but at risk of losing a good deal of diplomatic leverage in Asia, Europe and the western hemisphere.

We are witnessing nothing less than the geopoliticalisation of the world’s oil and gas industry. Governments rather than traditional commercial enterprises are taking control. And those governments have interests hostile to America’s.